Today on Small Business Saturday Tower Hamlets Labour visited small businesses across Tower Hamlets and asked small business owners to co-sign the Labour Group’s letter to the Chancellor of the Exchequer requesting further support for small businesses in this time of economic uncertainty.
According to the Federation of Small Businesses, Small and Medium Enterprises (SMEs) make up 99% of the business population in the UK and create 16 million jobs. Now in its tenth year, Small Business Saturday celebrates this success and encourages consumers to ‘shop local’ and to support businesses in their communities.
Tower Hamlets Labour highlighted the difficulties faced by small businesses with business rates, a crashed economy, soaring energy costs and supply chain issues, and how small business owners in Tower Hamlets as local employers are crucial to the local community and building the local economy. In the letter, Tower Hamlets Labour requests the Chancellor to immediately implement measures to support small businesses in the face of this crisis such as working with Local Authorities to issue a business rates rebate to small businesses to offset the cost of their energy bills that goes further than the current support provided and set up a national Small Business Hardship Fund to assist in these times of economic crisis.
Labour has recognised the support that small businesses need not only to survive but to thrive. This is why the national Labour Party has pledged to cut and eventually entirely scrap business rates, replacing them with a new form of business taxation fit for the 21st Century.
In a meeting of Tower Hamlets Council on Wednesday 5th October, Tower Hamlets Labour proposed a motion which pressed the Mayor of Tower Hamlets and the Aspire administration for immediate support for small businesses in the face of this economic crisis. The Mayor and the Aspire Party voted these proposals down.
Leader of the Tower Hamlets Labour Group, Cllr Sirajul Islam said:
“Tower Hamlets Labour is delighted to support this tenth anniversary year of Small Business Saturday. Small businesses do so much to enrich our lives and our community in Tower Hamlets, providing jobs, training and driving economic growth.
“I know that our local businesses have faced massive adversity and hardship over the last few years and beyond, and now face further challenges like unfair business rates, supply chain issues and soaring energy costs.
“This is why I am writing to the Chancellor of the Exchequer, along with many of our local businesses, to call for more substantive cost relief for this struggling sector so that Tower Hamlets’ local businesses do not just survive – they thrive.”
Full Text of the Letter to the Chancellor of the Exchequer
We are writing today on behalf of the small businesses in Tower Hamlets regarding the support available for small businesses in the face of the energy bill crisis and the current economic turmoil.
As you will know, the huge increase in energy bills have had a devastating impact on small businesses across the UK, where many are now concerned that they will have to close due to the unreasonable costs. This has now been exacerbated by the rapid economic downturn which is causing small business owners significant hardship and an uncertain future.
Many small businesses owners across Tower Hamlets have spoken of the immense struggles they are facing due to the economic climate, which is of the same scale of the Covid-19 pandemic. The Council was there for small businesses there under Labour’s leadership, providing over £200 million in grants and business rate relief to over 5,000 local businesses, however more needs to be done at both a Local Authority level and a Government level to ensure this crisis is tackled and our small businesses get the support they deserve.
If our small businesses are not supported during this crucial time, then this will have a devastating impact on our residents. The local economy depends on our local businesses – jobs will be at risk if our small businesses close down, and residents who depend on their facilities for their day-to-day needs will be neglected.
While you did announce a support package for small businesses in your recent Autumn Statement, this does not go far enough for struggling small businesses across the UK who had hoped for more substantive cost relief.
We would be grateful if you would immediately implement measures to support small businesses in the face of this crisis by working with Local Authorities to issue a Business Rates rebate to small businesses to offset the cost of their energy bills and provide a national Small Business Hardship Fund to assist in these times of economic crisis.
We look forward to hearing from you.
Cllr Siraj Islam
Leader of the Tower Hamlets Labour Group
Co-Signed by a number of small businesses in Tower Hamlets
Notes to Editors:
- The Chancellor warned on 17th October that “All departments will need to redouble their efforts to find savings and some areas of spending will need to be cut”.
- Paul Johnson, director of the Institute for Fiscal Studies (IFS), said there were no “easy options” and Mr Hunt would still have to make “scary decisions” by either raising taxes or cutting spending in his economic statement on 31st October.
- The Conservative chair of the Local Government Association (LGA) Cllr James Jamieson has warned that councils’ financial sustainability is “already on a cliff-edge” following the Chancellor’s announcement, adding that “the news that government departments have been tasked with identifying efficiency savings from public sector budgets has sent a collective shiver down the spine of local government.”
- The LGA has estimated that increases in the national living wage and higher energy costs had already added at least £2.4bn in extra costs onto the budgets that councils set back in March 2022. Councils will be left with no choice but to spend reserves, stop capital projects, or make cutbacks to services to meet their legal duty to balance the books this year. This funding gap will increase to £3.4bn in 2023/24 and £4.5bn in 2024/25, even before further funding cuts proposed by the Chancellor.